the palace. mostly a peaceful protest from that moment forth. just a lot of opposition factions. but sounding off, chanting anti-government and anti-president slogans. they've left that area, but the opposition still out here protesting against the president in tahrir square. >> we'll keep a close eye on that situation. i'm brooke baldwin in atlanta. thanks for being with me. let's go to wolf blitzer. "the situation room" begins right now. happening now, president obama says we're out of time for anything but a down payment for solving the nation's spending crisis. amid fears, the government may resort to chemical weapons, nato says yes to turkey to giving them patriot missiles. we'll talk to the former british

prime minister, tony blair. as they await a new heir to the throne, the british consider changing the rules about who can become king or queen. i'm wolf blitzer. you're in "the situation room." we begin with president obama's latest ideas for getting past the standoff with house republicans. he now says there isn't enough time left to do a comprehensive deal, including tax reform, fixing medicare. so he wants congress to raise tax rates for the wealthy right now and putting off the hard work to next year. they have 28 days left to make a deal before the country hits what's called the fiscal cliff. that's a combination of across the board tax increases for

everyone, coupled with cuts in spending like defense, education, health care, and housing assistance. let's go live to our chief white house correspondent jessica yellin with the very latest. jessica? >> reporter: president obama has now personally turned down speaker boehner's opening offer to avert the fiscal cliff. he did it in a tv interview. what does president obama think of speaker boehner's proposal to avert the fiscal cliff? >> unfortunately, the speaker's proposal right now is still out of balance. he talks about $800 billion worth of revenues but says he's going to do that by lowering rates. when you look at the math, it doesn't work. >> reporter: he won't agree to eliminate a tax deduction for contributions to charity. >> every hospital and university and nonfor profit agency across

the country would find themselves on the verge of collapse. so that's not a realistic option. >> reporter: but the president didn't say all this to speaker boehner. he said it in an interview on bloomberg tv. the last time the two men spoke was almost a week ago. president obama is focused on the stalemate with congress over averting the fiscal cliff, but he's just not talking to house republicans about it. at the white house, he discussed the issue with a bipartisan group of governors. >> i know that the president wants a deal and he didn't try to handicap it. >> reporter: earlier this week, he told so-called middle class americans on twitter, keep pressure on congress. he's even ventured outside the beltway rallying supporters to do just that. >> i'm going to be asking for you to be making your voices heard. >> reporter: why isn't he calling speaker boehner? >> we speak frequently.

>> reporter: when will the two of you sit down in a room? >> i don't think the issue right now has to do with sitting in a room. >> reporter: in part, the white house was burned with the negotiations in 2011 when lots of meetings failed to stave off a fiscal nightmare. but there's another strategy at play. some in the administration say they learned in the first term the best way to break washington stalemates, rally the public to their cause. here's how the president put it to cbs news. >> so getting out of this town, spending more time with the american people, listening to them and also then being in a conversation with them about where do we go together as a country, i need to do a better job of that in my second term. >> better job of explaining? >> well, explaining, but also inspiring. >> reporter: wolf, when it comes to a deal on averting the fiscal cliff, negotiations are on deep

freeze. from the white house's perspective, they're not going to budge until house republicans come around to the view that tax rates on the wealthiest have to go up. but you know house republicans don't want to agree to any kind of deal that includes that. so right now it's a blinking contest. of course, the white house thinks it's one they'll ultimately win, because in the new year tax rates automatically go up. >> and there could be a recession once again if we go into that fiscal cliff. how worried are officials over at the white house that the president will get a lot of blame for not showing enough leadership in forces a deal through by the end of the year? >> reporter: they take it seriously but they're not worried about the politics of it. they're confident that republicans will take the blame. you and i might not be so certain that it will only go to congress and americans will only be angry at congress. here inside the white house, they are quite confident that will be the case.

wolf? >> let's hope we don't go over the fiscal cliff. jessi jessica, thank you. as things stand right now, republicans want to keep all the bush tax cuts, but raise $800 billion by limiting some tax deductions, loopholes, et cetera. they also want to save will the $600 billion by cutting health care spending. the president says the republicans' proposal doesn't work because of the math. he wants to raise $1.6 trillion in taxes, twice as much as the republicans. and he wants to do it mostly by increasing tax rates on the top earners and proposes to cut health care spending by $350 billion. i'm joined by gloria borger. where do we stand on the expiration of the bush era tax cut? >> we are where we are, and what was interesting to me in listening and reading the transcript of that bloomberg interview today with the

president, sometimes you have to listen to what the president did not say. of course, he wants the tax rates on the wealthy to go up. did he specify the 39.6% rate of the clinton years? he did not. so is there a little give ultimately to sort of say what if it doesn't go up to 39.6%, but say 37%, is that something the white house would accept? also, this that same interview, the president raised the possibility, which is that after you do tax reform and you close loopholes and deductions, that if the rate is raised, the top rate, there's always a possibility that after you do tax reform, of course, the top rate would then go down again. so it was -- you have to listen to the president very carefully to see where there might be some give. the problem from my point of view is that everybody knows what's got to be done in the long-term.

it's the question of the short-term deal. >> john boehner, speaker of the house, he came up with a proposal. but not all the conservatives in the house and the senate are on board. jim demint, republican senator from south carolina. >> this is a time to negotiate with ourselves. we need to invite the president to work with us. his proposal was so outlandish, i don't think we should go back to the table until he puts something there that we can work with. the president has known about this fiscal cliff for over a year. and many of his decisions caused us to be in this position. >> how much of a problem does boehner have with other republicans potentially? >> it's a big problem. it's always been his problem. it's been a problem for the republican party since they started taking that no tax pledge 30 years ago. what is revenue increase? is closing deductions and

loopholes a revenue increase? and if so, do you have to oppose that? i think what we see going on in the republican party right now is a fight between the stalwart, no new tax whatever conservatives and those who believe that they have a responsibility to keep the country from going over the fiscal cliff in the short term and in the long-term. and as jessica was pointing out earlier, the white house has a point here. if you look at public opinion polls by about a 2-1 margin, people say they would blame republicans more than the president or democrats if we were to go over the cliff. so if you're speaker boehner, this is something you have to think about. >> a serious problem. look at this poll. washington post poll, will the congressional leaders reach a deal before january 1? 40% said yes, 49% said no. do those numbers motivate the

folks out there? >> they should. look how pessimistic the numbers are. of course, they should also understand that pessimism, going into the holiday season and uncertainty for ceos is not a good fiscal environment for the country. so of course this should motivate them. the question is, who is going to blink first? personally i think they all ought to get in a room and work it out. >> maybe go to camp david and spend a few days there. >> or come in "the situation room." >> we'll put them on television. we're moving on to today's other important developments, including syria's bloody civil and this special envoy for the middle east, the former british prime minister tony blair is standing by to join us right here in "the situation room." ♪ the weather outside is frightful ♪

♪ but the fire is so delightful ♪ nothing melts away the cold like a hot, delicious bowl of chicken noodle soup from campbell's. ♪ let it snow, let it snow ♪ many hot dogs are within you. try pepto-bismol to-go, it's the power of pepto, but it fits in your pocket. now tell the world daniel... of pepto-bismol to-go.

to provide a better benefits package... oahhh! [ male announcer ] it made a big splash with the employees. [ duck yelling ] [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] ...forbusiness.com. ♪ ha ha! well, having a ton of locations doesn't hurt. and a santa to boot! [ chuckles ] right, baby. oh, sir. that is a customer. oh...sorry about that. [ male announcer ] break from the holiday stress. fedex office.

today, nato approved turkey's request for patriot missiles to defend its border with syria. the decision comes amidst fears the syrian government may be preparing to use chemical weapons. but nato insists the deployment is defensive. we'll talk about all of this with the former british prime minister tony blair shorty. and our foreign affairs correspondent is at the nato meetings right now in belgium. >> reporter: nato insists the deployment of thements is defensive only, not part of any plan for a no-fly zone in syria. the alliance gives the green light for deploying air defense

systems to turkey to protect that ally against possible attacks from syria, including any possible use of chemical weapons. >> the nato ministers unanimously express grave concerns about reports that the syrian regime may be considering the use of chemical weapons. any such action would be completely unacceptable and a clear breach of international law. >> reporter: the move comes amidst u.s. concerns that the assad repeople may be cooking up recipes, mixing materials for chemicals. that possible preparation is taking place at more than one chemical plant in syria, officials say. u.s. intelligence shows nothing has been moved out of the facilities, however. and officials say there is no

indication syria is on the verge of using chemical we papoweapon. in turkey monday, russian president putin called the deploy ment of the patriot missiles unnecessary. but tuesday, the russian foreign minister said any use of chemical weapons has grave implications. while down playing reports about syria. >> translator: we can call them rumors, but the syrian authorities are moving a stockpile of chemical weapons or that they want to use them. as soon as we hear such messages, we prepare. >> reporter: secretary of state hillary clinton spent the day meeting with her fellow ministers as they approved a plan to provide turkey with the missiles. nato says the number of missiles

and their precise location along the border still needs to be worked out. it could be weeks before the equipment is in place. u.s. officials insist the intelligence about syria's chemical weapons was strong enough to warrant president obama's warning. but they say at the moment, there is no imminent planning for any u.s. military action. wolf? >> jill, thank you. jill reporting from nato headquarters in belgium. so will patriot missiles keep the syrian civil war from destabilizing more of the middle east? in just a minute, we'll ask tony blair and talk about that and the violence in egypt. a lot more when we come back. al] the rhythm of life. [ whistle blowing ] where do you hear that beat? campbell's healthy request soup lets you hear it... in your heart. [ basketball bouncing ] heart healthy. great taste. mmm... [ male announcer ] sounds good. it's amazing what soup can do.

[ gordon ] for some this line is a convenience. how you doing today? i'm good thanks. how are you? i'm good. [ gordon ] but for others, it's all they can afford. every day nearly nine million older americans don't have enough to eat. anything else? no, not today. join me, aarp, and aarp foundation in the drive to end hunger by visiting drivetoendhunger.org. bp has paid overthe people of bp twenty-threeitment to the gulf. billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are open, and many areas are reporting their best tourism seasons in years. and bp's also committed to america. we support nearly 250,000 jobs and invest more here than anywhere else. we're working to fuel america for generations to come. our commitment has never been stronger.

trust duracell to power their donated toys? duralock power preserve. it locks in power for up to 10 years in storage. guaranteed. duracell with duralock. trusted everywhere.

growing unrest in egypt as protesters and police clash at the president palace in cairo. these images, these pictures are very powerful. >> the video we've been seeing is amazing. egyptians protesting president morsi broke through barbed wire at the palace and threw chairs and rocks at police, who in turn tossed tear gas into the crowd. the health ministry says 50 ambulances have been sent throughout cairo where hospitals are on high alert. the protests come as egyptians count down to a public referendum on a new constitution. much more to come on that. in south carolina, parents who camped out for days to get first choice where they kids go

to school found themselves in a stampede. thousands raced to get in line. one parent was injured but not seriously. officials obviously are re-evaluating their plan. in nashville, anger and shock after police declare a woman dead after a traffic accident. the 30-year-old mother of three was struck by a car while crossing the street. police told the victim's family that she had died. their calls to the hospital found her alive but in critical condition. is president obama considering the vogue editor ambassador to the united kingdom or france? she's among a handful of top obama fund-raisers interested in the post. she's said to have inspired the film "the devil wears prada." that would be very interesting. >> she knows both cities very

well. >> and she has quite a reputation for being a tough negotiator. >> thank you. tony blair is standing by to join us live. we're going to talk about the international suspicions that syria's regime may be preparing to use chemical weapons against its own people. two years ago, the people of bp made a commitment to the gulf. bp has paid over twenty-three billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are open,

and many areas are reporting their best tourism seasons in years. and bp's also committed to america. we support nearly 250,000 jobs and invest more here than anywhere else. we're working to fuel america for generations to come. our commitment has never been stronger. he opened up jake's very private world. at first, jake's family thought they saved ziggy, but his connection with jake has been a lifesaver. for a love this strong, his family only feeds him iams. compared to other leading brands, it has 50% more animal protein... ...to help keep ziggy's body as strong as a love that reaches further than anyone's words. iams. keep love strong.

joining us now from new york is the former british prime minister tony blair. he's now the special envoy to the middle east for the u.s., russia, the european union and the united nations. prime minister, thanks, as usual, for joining us. >> thank you, wolf. >> good to see you the other day in jerusalem. let's talk about what's happening in the middle east right now. the u.s., the obama administration, nato now obviously very concerned about the regime of president assad

potentially using chemical weapons, poison gas against its own people. here's the question, what is the difference killing civilians in syria with bombs from jet fighters or attack helicopters as opposed to using say poison gas or chemical warfare? >> that's a good question. in one sense in moral terms, there is no difference and almost 40,000 people have died in syria already. but i think the use of chemical weapons and poison gas, i think the fatalities would be very much greater. and it does cross a line. these aren't judgments that you can make in any scientific way. but i think what your administration, the international community is signaling to president assad, if you cross that line, there will be a strong reaction. >> those are tough words coming from president obama, from secretary of state hillary clinton, from the nato

secretary-general today in brussels. but is that enough to president bahar al assad from using chemical weapons or is there something else the international community should be doing? >> it's important, and i'm sure this is being conveyed to him, it's important that he understands that that response is going to be emphatic. so it won't be in other words that we issue a strong statement. there will be some action that will follow. look, i think he will appreciate that. but the real question is how do we bring this appalling disaster, which is unfolding in syria, to an end to try and get a situation where you move to a different type of constitution in which the people can have a say in electing their government. and where the countries then are put on a more stable footing. because once that goes, then what? so this is fantastically

difficult. once you lift the lid off these very repressive regimes and out comes all this religious and tribal tension, we have to find a way to stabilizing the situation and bring the bloodshed to an end. >> elsewhere in the region, egypt right now, we're seeing these protesters, these anti-mohammed morsi protesters moving closer and closer towards the presidential pass palace in cairo. they're concerned about what morsi is doing as far as democracy in egypt. how worried are you about the situation in egypt? >> i think egypt is key to the region, so the answer is, you've got to be extremely worried when you see instability affecting egypt. this is, again, the birth pangs

of proper democracy in some ways, but this struggle is immensely important. obviously what's important in these countries where they've moved to a democratic system is that there is a clear understanding that democracy is not just a way of voting but a way of thinking. pant of that way of thinking is that you've got to protect minorities. you've got to -- democracy doesn't function unless it is accompanied by an open mind. and so you can understand there is a lot of anxiety in egypt about the constitutional changes proposed. and even as the international community obviously applauded egypt's efforts in bringing about the cease-fire in gaza, there is anxiety about what's happening there now. i hope it can be resolved in a way that gives egypt the balance and democratic constitution that most egyptians want to see. >> your main job is trying to revive the israeli-palestinian peace process.

there hasn't really been a peace process over the last few years. now in the aftermath of the united nations general assembly resolution declaring palestine a full nonobserver state of the united nations, the israelis reacting with announcing more settlements, including along areas that could isolate the contiguity of the west bank. is it over with as far as you're concerned, the peace process? >> no, it's not over with. it's very tough right now, and i understand the frustrations that led the palestinians, the u.n. i understand the frustrations of the israelis and the presen situation. but the fact is, when all of that frustration is done, you have to get back to the reality. and the reality is there is only one way of stabilizing the situation and that is getting back to a credible negotiation

with a frame work shaping it that allows us to negotiate a two-state solution. i still believe despite people saying there's no way it can happen, it's the only answer. >> is there any hope in the immediate future, those talks, direct face-to-face negotiations between the israelis and palestinians will get off the ground? >> it's possible. we've discussed this many times, wolf. most of the time we've been talking about the latest impact. but president obama has been re-elected here in the u.s. i know he feels deeply about this issue. he regards peace between israelis and palestinians as a genuine strategic interest of the united states. and we're going to have i think a fresh opportunity to go back to this issue to try and grip it and frame it in the right way

and we've got to try. i always say to people, we spent decades trying and failing in northern ireland and finally we got a process that worked. there isn't an alternative except to come back and try again. and that's what we've got to do. by the way, as the region is in turmoil, although in one sense it becomes harder for the parties to see their way through, it's more important that the israeli-palestinian issue is put in a place where there's hope and progress. because it could, especially with the other changes in the region, get mixed up in the politics of the region in a way that puts us even further back. >> i know you're watching what's going on with these so-called fiscal cliff negotiations here in the united states. as concerned as we are here in the united states, your concern is that there could be serious international ramifications if the u.s. does go over the cliff. explain your concern.

>> the concern people have is the world economy is in a very fragile state right now. i don't have to say what the problems of the eurozone have, they're very manifest. but the global economy as a whole, there's a lack of confidence, a worry about where it's going. so if you in america, and people have a lot of confidence in america in this regard, if you can sort out this issue, then even though that doesn't sort out all the problems of the american or global economy, it would be a big boost and give people a sense of confidence that there was -- you guys have got your act together. the decisions were being taken, and i think it will be good for you and good for us. so i hope you do it. i believe you will. i know right now there's bound to be tough negotiations. the president has been re-elected and i think that gives the situation its own

special momentum. i hope you resolve it and then we're going to have to take some tough decisions over our way, too. >> very quickly. there was a cute video of hillary clinton here in washington over the weekend, and it had a clip from you in there. i'll play that little clip. ♪ you're amazing, just amazing ♪ just the way you are >> i suppose the best is yet to come. ♪ yeah >> you said the best is yet to come. what did you mean by that? >> i think, wolf, sometimes when you make a comment, you're best to leave the enigma floating there. >> i understand completely what you're saying. one final question before i let you go. the royal baby, as that baby is now being called in britain, do you fully appreciate, do you understand? because i'm confused about the

succession issue in england, where the baby or baby it is there are swins for that matter, where they would stand, because i know there's some significant changes in the works right now. >> the significant changes are really to do with the fact that whether it's a boy or a girl, they're going to be treated equally from now on. that's the basic agreement. >> is that a done deal and needs to be ratified by a bunch of international groups? >> i hope not various international groups but i think it is a done deal, yes. i think so. i'm not totally up to speed with it. but basically, the country will be extremely excited about it. and i find even a certain level of excitement here. but the essential thing is, the baby will be in line for the throne and there will be, for the first time, not discrimination against -- no discrimination boy and girl.

no discrimination religiously either. so this is progress. >> certainly is. and we wish the royal couple only the best. prime minister, thanks as usual for joining us. we got through a lot of different issues. appreciate it very much. >> thanks the, wolf. all the best. >> we're going to be going live to london later to get an update on what's going on at the hospital. the fox news chief may have had his own favorite for the white house and it wasn't necessarily mitt romney. red lt ends soon. hurry in and try five succulent entrees, like our tender snow crab paired with savory garlic shrimp. just $12.99. come into red lobster and sea food differently. and introducing 7 lunch choices for just $7.99.

trying to find a better job can likbe frustrating.gs, so at university of phoenix we're working with a growing list of almost two thousand corporate partners - companies like microsoft, american red cross and adobe - to create options for you. not only that, we're using what we learn from these partners to shape our curriculum, so that when you find the job you want you'll be a perfect fit. let's get to work. humans -- sometimes life trips us up. and sometimes, we trip ourselves up, but that's okay. at liberty mutual insurance we can "untrip" you as you go through your life with personalized policies and discounts when you need them most. just call...

and speak with a licensed representative about saving on your policy when you get married, move into a new house... [crash!] or add a car to your policy. don't forget to ask about saving up to 10% when you combine your auto and home insurance with liberty mutual. security, coverage, and savings. all the things humans need to make our beautifully imperfect world a little less imperfect. call... and lock in your rate for 12 months. liberty mutual insurance. responsibility. what's your policy?

did fox have a horse in the presidential race? the network's founder, roger ailes, wanted then general david petraeus, to make a run for the republican presidential nomination. cnn's national political correspondent jim acosta is joining us now. pretty i guess bombastic report out there, with a lot of detail. >> that's right. this goes back to the fact that some republicans were longing for alternatives to the official gop candidates in the 2012 race, and as an audio recording reported by "the washington post" reveals, fox news chief roger ailes appears to step out of the traditional role of news executive to recruit a candidate, david petraeus. before the affair that just last month forced david petraeus to step down as director of the cia, he was so popular in republican circles that roger ailes, the chairman of fox news, tried to enlist the four-star general to run for president back in 2011.

according to a recorded conversation obtained by washington post reporter and author bob woodward. >> i'm not running. >> reporter: making the pitch is katie mcfarland. she tells the general that ailes was willing to give up his job at the network to run a pate pa try use campaign. >> reporter: that big boss, she says, was rupert murdoch, head of fox news parent company news corp ration. but petraeus repeatedly shoots

down the idea. after he later accepted the job at the cia, mcfarland went on fox to talk about her conversation with the general, but never mentioned the ailes' offer. >> i think that he doesn't want to run. i asked him that question and he said i'm not running for president. >> reporter: ailes said he did ask mcfarland to approach petraeus, but added -- >> cnn media critic howard kirk says one part of the pitch is because in. >> the idea that rupert murdoch would bankroll it is not that far-fetched. >> reporter: murdoch repeatedly injected himself in the race, saying mitt romney last week, tough chicago pros will be hard to beat unless he drops old

friends from team. and romney people upset at me. of course i want him to run, save us from socialism. republican operatives say they had a sense during the campaign that some at fox had their favorites. >> you do have people over there that had candidates they weren't shy about saying stuff about. >> reporter: that operative you just saw works for rick santorum who meets with roger ailes later this week. as for ailes, we reached out to the network for a comment and did not get a response. >> you covered the republican campaign throughout. republicans and democrats thought that fox news was playing a direct role in that campaign. >> they did. and wolf, i had one of the final candidates in the race come up to me during the republican convention and say basically that he felt that fox was a little too much in the tank for one of his rivals. obviously, that's something that certain candidates might feel from time to time if things

aren't going their way, but i was surprised to hear that from one of the final candidates in the raise. >> thank you very much, jim acosta, for that. let's dig deeper on this story with our strategy session guest. joining us, the democratic strategist paul begala, and republican strategist mary matalin. all right, assuming the story is accurate, paul, what do you make of this? >> well, look, first off, everybody knows that roger ailes is a conservative republican. and he's one of the smartest people i've ever come across in politics and media. he helped create president nixon and president bush senior and fox news. but it doesn't take a genius to know this republican field was very weak. i'm sure he's telling the truth when he says i was trying to shake up the field. it was a shockingly weak field and it was a smart play. getting general petraeus would have helped the republicans

enormo enormously. i'm not generally one to probably praise the head of fox news but i think he was right about this. >> paul, do you think there was any difference between ailes encouraging someone to run for the republican nomination as opposed to say oprah, who encouraged barack obama to run for the democratic nomination? >> not in an important way. fox news is a dominant player in the republican party. it's a misnomer to call it a news channel, at least in the evening hours. they are obviously conservative. but i'm not shocked by this at all. i think roger was right, it was a very weak field that needed shaking up. >> you think, mary, that fox news is basically an arm of the gop? >> no, i do not think fox news is an arm of the develop. but there are a number of really incredible conservatives and libertarian voices there. i cannot believe i'm going to have this holiday cheer of

agreeing with paul begala that roger ailes is not only a genius, but a visionary with a robust enthusiasm for life and work. but not so much robust affection for politics anymore. believe me, we beg id him to get back into politics. but he is running a news organization, and everything that's in the story about shaking up the field was probably true. but i love to pear paul begala call one of my favorite people in the world a genius, because he is that. >> you want to revise or amend your comments, after what mary said, paul? >> sometimes the truth hurt, but the guy is remarkable. he's a very talented guy. >> certainly is. let's talk about the former president george bush. he gave a rare speech today in dallas. listen to this clip.

>> america can be a lawful society and a welcoming society at the same time. as our nation debates the proper course of action relating to immigration, i hope we do so with a benevolent spirit and keep in mind the contribution of immigrants. >> he still wants, mary, comprehensive immigration reform. he tried and failed when he was president but he's making a major pitch for it once again. >> right. and he got 17% for hispanics and 16% more asians. that doesn't mean we have to give up our principles and it was the democrats that stopped the comprehensive immigration. we need it for the economy and we need to do it morally. >> we've got to leave it.

guys, thank you very much. the once in the future king or queen. the royal baby talk is all the talk. but what would twins, yes, twins mean for succession to the throne? we're going london live, straight ahead. anncr: some politicians seem to think medicare and... social security are just numbers in a budget.

well, we worked hard for those benefits. we earned them. and if washington tries to cram decisions about the future... of these programs into a last minute budget deal... we'll all pay the price. aarp is fighting to protect seniors with responsible... solutions that strengthen medicare and... social security for generations to come. we can do better than a last minute deal... that would hurt all of us.

the latest now on the royal baby, britain's catherine, the duchess of cambridge, is spending a second day in a london hospital. she was admitted for acute morning sickness, a condition

often associated with women carrying twins, which raises lots of questions about succession to the throne. max foster is joining us now live from london with details. max, what's the latest? >> reporter: we've been given the information the duchess is pregnant and in the hospital. but they don't want to give a running commentary. prince william was here today, spent the day with the duchess. when he left, we did get an update. this is what the palace told me. the duchess is continuing to feel better. she and the duke are grateful for the good wishes they've received. she will continue to remain in the hospital and be treated for acute morning sickness. she's improving as she rests and gets the nutrients she needs. >> i know, max, there's been question about succession,

especially if there are twins. we have no idea if she's carrying twins, but has all this been worked out and if it has, walk us through what happened. >> reporter: the pressure is on. there is a general agreement in the government, and the queen agrees with this, everyone has agreed, but if kate has a girl, that girl should automatically become the next in line to the throne after prince william. but at the moment, she has a younger brother, and that younger brother will leapfrog her. just to give you a sense of how complicated this is, wolf, these laws go back hundreds of years. you have to identify which laws, going back a hundred years, or a thousand years even, what needs to be changed. not just this this country, but in 15 other countries, canada, australia where the queen is head of state. but there was a breakthrough today. all those governments in those

countries said we can't sort out our laws in this country. so there has been some progress. one stumbling block, wolf, and that is a catholic still will never be able to succeed to the throne and some people in scotland and canada think there's discrimination still in the law so they have a problem with it. so that might block things. >> if there are twins, it doesn't make any difference if the first child is a boy or girl, that first child will be the next in line? >> what's interesting is that if there's a c-section, which child becomes the first to come out? the first one to come out will be the next one to the throne. protests over at egypt's presidential palace in cairo. reza saya will tell us what he

saw, that's coming up. yep. the longer you stay with us, the more you save. and when you switch from another company to us, we even reward you for the time you spent there. genius. yeah, genius. you guys must have your own loyalty program, right? well, we have something. show her, tom. huh? you should see november! oh, yeah? giving you more. now that's progressive. call or click today. >> hi. >> you know, i can save you 15% today if you open up a charge card account with us. >> announcer: we all love a good deal during the holidays, especially identity thieves. they can open an account in your name and go on a serious spending spree. >> do you have cufflinks? >> mm-hmm. >> gold ones? >> announcer: not on our watch. we're lifelock, with the most comprehensive identity theft protection you can buy. go to lifelock.com or call 1-800-lifelock today. [whoosh] lifelock-- relentlessly protecting your identity. two years ago, the people of bp made a commitment to the gulf.

bp has paid over twenty-three billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are open, and many areas are reporting their best tourism seasons in years. and bp's also committed to america. we support nearly 250,000 jobs and invest more here than anywhere else. we're working to fuel america for generations to come. our commitment has never been stronger. i have obligations. cute tobligations, but obligations.g. i need to rethink the core of my portfolio. what i really need is sleep. introducing the ishares core, building blocks for the heart of your portfolio. find out why 9 out of 10 large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal.

meet the 5-passenger ford c-max hybrid. when you're carrying a lot of weight, c-max has a nice little trait, you see, c-max helps you load your freight, with its foot-activated lift gate. but that's not all you'll see, cause c-max also beats prius v, with better mpg. say hi to the all-new 47 combined mpg c-max hybrid.

get selsun blue for itchy dry scalp. strong itch-fighters target scalp itch while 5 moisturizers leave hair healthy. selsun blue. got a clue? get the blue. former new york mets baseball playerer lenny dykstra sentenced after bankruptcy fraud. >> the outfielder who helped the mets win the 1986 world series was sentenced to 6 1/2 months in a federal prison. already serving time for an unrelated crime. he admitted selling items from his $18 million mansion after creditors seize it in bankruptcy. the six children who were

riding this bus fortunately were not injured. but the driver will be charged with running a red light. the florida patrol says the bus was t-boned, then hit the pole. a sight no parent ever wants to see. a new movie about steve jobs will premier at the sundance film festival. you see ashton kutcher looks like a young jobs. it covers a 30 year span. another movie you have to see. >> i will see it for sure. thank you. you're in "the situation room." syrian rebels laying siege to a key government military base. aur own arwa damon is on the ground inside syria and behind rebel lines. and violence spreading in egypt. protesters break through barriers to attack police as ambulances race to the presidential palace.

and why a father fears he'll never see his 5-year-old daughter again unless the united states supreme court steps in. we want to welcome our viewers in the united states and around the world. i'm wolf blitzer. you're in "the situation room." weeks of violent protests in egypt are now spreading. demonstrators, angry at a perceived presidential power grab, delivered their outrage today at the presidential palace in cairo, where at one point protesters breached the security barricades. you just got back from some of those violent protests at the egyptian presidential palace. tell us what you saw.

>> reporter: we want to be careful not to blow this out of proportion. there were no widespread clashes, but protesters were throwing rocks and debris at police and broke through a barrier that security forces arranged. security forces responded by firing tear gas. the question is would things escalate and they didn't. police retreated, went behind the palace walls and things calmed down considerably. in the next few hours, the protests were mostly peaceful. most of these opposition factions have focused their demonstrations over the past couple of weeks here in tahrir square. but tonight, they went to the president's palace with their message that they don't like what he's done with these decrees and they don't like the draft constitution. some still calling for his

ouster. >> the other day some protesters were giving closer and closer to the u.s. embassy compound in cairo. that's not far away from tahrir square. is that embassy secure? is everything okay there? >> reporter: it is. and that had everything to do with the proximity of the u.s. embassy to tahrir square. it's just a couple blocks away. at no time were there any indications that these protesters were targeting the u.s. embassy, and tonight no indications they were targeting the palace. the state media saying at no time was the president in danger. a week or so ago, when it was intense -- >> bottom line, it looks like there's no end in the short term to the demonstrations and the clashes with police, the tear bass, the pictures are very dramatic. is that an accurate assessment, reza?

>> reporter: it seems that way, but it's important to point out that the momentum seems to be shifting in favor of the president and supporters. he's called for the national referendum on december 15. he already has executive and legislative powers with those decrees. he has a lot of supporters. the opposition factions and protesters, if question is, how much staying power will they have? how much stamina do they have? and what other options beyond protesting do they have? we'll keep our eyes out. >> reza sayah on the scene for us in cairo, thank you. nato is echoing president obama's strong warning to the syrian regime against using chemical weapons against his own people. u.s. intelligence is deeply concerned right now that the assad regime is mixing deadly sarin gas for possible use against rebels. the nato secretary-general

saying that would draw immediate international reaction. inside syria, the possibility of chemical attacks has civilians terrified. joining us now from northern syria, our own arwa damon. arwa, we've now learned the syrian military is actually mixing up various recipes for poison gas. what are the rebels, the civilians there on the ground in northern syria where you are telling you about this? >> reporter: this is a civilian population that's not been able to defend itself against bullets and bombs. so when it comes to chemical warfare, they have no defense system whatsoever. some of the rebels and the activists do in fact believe that the stronger the strangle hold gross on regime forces, the greater the likelihood it is that the government is going to employ these chemical weapons.

in fact, not far from aleppo is one of the main suspected places, a weapons manufacturing facility that fighters are telling us is one of the areas that the regime is focusing on defending and is one of the areas where there are great suspicions and some intel saying that is perhaps one of the sites that the regime is in fact experimenting when it comes to chemical weapons. so people are terrified that that could be an option if the regime chooses to undertake. >> we know you've been following the standoff between the regime and a base surrounded by rebel forces. i want to play this report that you filed. >> reporter: close to aleppo, the rebels have a stronglehold on a sprawling military base. there's a red gate next to a stone wall. right behind it is the wall that is the outer perimeter of the

military academy. it's less than 100 meters away, some 330 feet. [ gunfire ] we quickly move to another vantage point in the building next door. "it's clashes," he says. he used to be a tailor. since the uprising began, he's been wounded four times and detained three. the rebels don't have binoculars, so he uses a camera to zoom into the base and show us government positions. you can see a sandbagged fighting position on one of the roofs. >> reporter: fighting has been fierce, but the rebels are confident they have the upper hand. he uses a pool table to map out

where government units are. in all, three rebel brigades are surrounding the base. plus a militant islamist group. this is the road to aleppo, he says. once we finish the academy, the direct route to the north will be open. so far, 250 soldiers at the base have defected since the uprising began. the majority joining rebel ranks. but some 450 remain inside. air drops of food often miss their target. the rebels have shot out the water supply. there used to be a sniper on top of the tower who would take shots at them. they own the night, but we own the day, he boasts. he says the rebels could easily overrun the base, but they want

to give others a chance to defect. they've even punched holes in the walls of the perimeter. this man, a defected soldier, says the senior officers are just looking after themselves. he and the others here, some of whom don't want to appear on camera, fled together. they were trainers on the base. around the perimeter, it's something of a human shield he says. in isn't a single point that doesn't have a soldier on it. there are only two to three meters between each. the soldiers have stockpiles of artillery. but jamal says their options are dwindling. they have reached a dead end. slowly they are weakening, he says. [ gunfire ] this is not the first base in northern syria to come under

siege. in this area, the free syrian army is getting the upper hand in a grim war of attrition. >> arwa is back with us. how much territory do the rebels actually control in an around aleppo? >> reporter: it's pretty impressive how far they have managed to come, given the fact that there's been no significant international -- or based on our moving around the area, they control -- or rather the regime does not control the eastern portion of the city of aleppo. although there are pockets where there is significant front lines in that portion. they control a little bit of the southwest and northwest, as well. they do not control the aleppo airport, which lies to the east. here is what is interesting, wolf. a lot of these military bases, military institutions or

facilities are coming under siege. a pilot who defected from the military portion of the aleppo airport told us it was around 50% under siege. so the rebels are beginning to move in and force the regime into various parts of the city and onto their bases in many instances, as well. >> arwa damon, one of the few western journalists inside syria right now, reporting from northern syria, risking her life to bring us these reports. be careful over there and we'll touch base with you later. >> thank you. out of balance. that's how president obama is describing republican plans for avoiding the fiscal cliff. can these two work together? we'll ask congresswoman debb ebr debber -- debbie wasserman schultz. anne's tablet called my phone.

anne's tablet was chatting with a tablet in sydney... a desktop in zurich... and a telepresence room in brazil. the secure cloud helped us get some numbers from my assistant's pc in new york. and before i reached the top, the board meeting became a congrats we sold the company party. wait til my wife's phone hears about this. [ cellphone vibrating ] [ female announcer ] with cisco at the center, working together has never worked so well.

share "not even close." share "you owe me..." share "just right." the share everything plan. shareable data across 10 devices with unlimited talk and text. get a droid incredible 4g lte by htc for $49.99. he's going to apply testosterone to his underarm. axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men. axiron is not for use in women or anyone younger than 18. axiron can transfer to others through direct contact. women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. report these signs and symptoms to your doctor if they occur. tell your doctor about all medical conditions and medications. do not use if you have prostate or breast cancer.

serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. see your doctor, and for a 30-day free trial, go to axiron.com. energy is being produced to power our lives. while energy development comes with some risk, north america's natural gas producers are committed to safely and responsibly providing generations of cleaner-burning energy for our country, drilling thousands of feet below fresh water sources within self-contained well systems. and, using state-of-the-art monitoring technologies, rigorous practices help ensure our operations are safe and clean for our communities and the environment. we're america's natural gas.

that's a bitter backlash from republicans, at least some republicans over the house gop proposal to keep the country from going over the so-called fiscal cliff at the end of the year. president obama says it doesn't go far enough, but republican critics say it goes way too far. dana bash is on capitol hill, watching all of this unfold. dana, what are you hearing? >> reporter: republican sources i'm talking to think maybe it's sort of the goldilocks scenario. if one side thinks it's too far, the other side thinks it's not far enough, maybe it's just right. the republican counteroffer calls for $ 800 billion in tax hikes. >> rates have to go up. >> reporter: but the fact that gop leaders proposed raising $800 billion in taxes is roughing many a feather in their

own party. >> republicans should not be conceding that the federal government needs more money and treating the president's proposal like it's serious. >> reporter: senator jim demint is an anti-government, anti-tax purist who helps raise millions for conservative candidates, even against fellow republicans. >> there's some that want to go the politically expedient route to give the president what he wants to get out of this mess. >> reporter: he's hardly the only conservative upset. the conservative heritage action network said, call your representatives and they will your representatives tax hikes are not part of the solution. the e-mail including, this infamous pledge cost george bush his re-election. >> read my lips, no new taxes. >> reporter: well aware of the potential conservative blowback that could imperil his leadership, john boehner was careful to include other gop leaders on this proposal let

tore the president, including former vice presidential candidate paul ryan. >> he won't raise taxes, we'll cut taxes for small businesses and families. >> reporter: even the senate republican leader fell short of embracing the gop offer that includes tax increases. >> the house republican leadership is trying to move the process forward. frankly, i had hoped we would be accomplishing more in the real talks that are going on privately. but being aware of those is nothing going on privately that's not going on publicly. >> reporter: why are there no talks going on privately right now? democratic sources say they believe right now they have a win-win strategy going. if one win would be for

republicans to cave and give in on raising taxes for the wealthiest americans, so they're hoping to run out the clock and push that. but if they fail and we go over the fiscal cliff they believe republicans will get blamed for that. but one interesting subplot that's going on in the house, according to a member of the senate republican leadership, john boehner really has to be careful to whatever he agrees to, if he agrees to a deal, to make sure it can get a majority of the majority. meaning most of the republicans in the house could vote for it. because if he doesn't, it could weaken him ultimately and make it harder for him to negotiation with the white house in the future. >> nancy pelosi and fellow democrats are pushing what's called this discharge petition to skirt around republican opposition. they need 218 to approve this procedure. they have a vote whether to continue the tax breaks for 98% of the families out there.

does it have a chance to get off the ground? >> it looks very unlikely. so far, according to a democratic source, they have 142 signatures. but they need 218. just to give you a sense of how hard it's going to be, our producer talked to republican tom cole, who has been saying we should pass just the middle class tax cuts, he says even he won't sign it, because it's about loyalty to your party and hard to see republicans going for that. so it would be hard to get to 218. >> thank you very much, dana. there's more than just taxes at issue. entitlements are a huge part of the fiscal cliff standoff. john king is joining us. john, explain to the viewers how medicare factors into all of this. >> reporter: it's where the money is, or at least where a lot of it is. we have this credibility standoff right now. republicans say the president

won't be credible until he pushes the democrats to go more on medicare and other entitlement programs. but led's look at the medicare argument. if you're a single man born in 1945, that means you're approaching 70, on medicare. if you made about $20,000 a year during your career, that was your average, then in medicare taxes, you paid about $18,000, roughly $18,000 to $20,000 in taxes. if you made about $110,000 a year in your career, you paid about $88,000 to the government in medicare taxes. that's what you paid in. a lot of conservatives are saying you need to change the program. this is one of the reasons why. this is what you get out. if you paid $18,000, you're getting ten times out over the course of your lifetime in benefits. you paid about $88,000 in, you're getting a 2-1 deal, more than $200,000 in benefits. so conservatives and republicans say we've got to change this program somehow.

we have to take some money out of medicare, reduce the costs. here's one of the reasons that's essential. if you look through the '70s, '80s, '90s, even up to now, the green is the revenue, the red line is the cost. roughly the money coming in has kept pace with the cost. but 2020, you see this gap. then you have this much coming in and this much going out. this is why medicare down the road adds so much to the federal budget deficit. so republicans say raise the retirement age to 67 or means testing, meaning making more wealthy americans pay more into the system or get less out of the system. if you means test, that means you're paying less out to affluent americans. if you raise the retirement age, you're paying out less as money comes in and keeping the revenue

line closer to the cost line. that is the goal. so when you do a 10 or 20-year calculation, medicare is not adding to the deficit. but that's the policy and just as republicans are having a backlash against the speaker saying we don't think we should put tax increases on the table, the democrats and some of the new members in congress, they say they ran promising not to touch medicare. so they say they won't do this. so you have the credibility challenge. republicans say give us entitlement and other spending cuts and the democrats want higher tax rates. that's why we have a stalemate. an internet icon wanted in connection with the killing of his neighbor. stay with us, you're in "the situation room." that offer an epa-estimated 30 mpg highway or better. yeah? hey.

hey. where's your suit? oh, it's casual friday. oh. [ male announcer ] chevy's giving more. now get a 2013 malibu ls for around $199 per month, plus competitive lessees can get $1,000 toward the down payment for an even better deal. [ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa, and the aerospace industry in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing.

and with my bankamericard cash rewards credit card, i love 'em even more. i earn 1% cash back everywhere, every time. 2% on groceries. 3% on gas. automatically. no hoops to jump through. that's 1% back on... [ toy robot sounds ] 2% on pumpkin pie. and apple. 3% back on 4 trips to the airport. it's as easy as... -[ man ] 1... -[ woman ] 2... [ woman ] 3. [ male announcer ] the bankamericard cash rewards card. apply online or at a bank of america near you. anyone have occasional constipation, diarrhea, gas, bloating? yeah. one phillips' colon health probiotic cap each day helps defend against these digestive issues with three strains of good bacteria. approved! [ female announcer ] live the regular life. phillips'.

an intense typhoon has struck the philippines. kate bolduan is monitoring that. >> it's the most powerful typhoon to hit the southern philippines in decades. it came ashore this morning, destroying homes and killing more than two dozen people. the international space station captured this shot of the typhoon as it was bearing down on the philippines. we'll show it to you later. a lawyer for john mcafee says he's left belize and is in guatemala city. he's wanted in connection for the shooting death of his neighbor. he's told cnn he is innocent and

will not surrender to police. former alaska governor sarah palin has apologized for remarks she made about congressional republicans she thinks are compromising too much in the battle over the fiscal cliff. she called them wusses and wobbly. it's the kind of case you rarely see at the united states supreme court. the justices are about to weigh in on a child custody battle.

when you take a closer look... ...at the best schools in the world... ...you see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level. let's develop more stars in education. let's invest in our teachers... ...so they can inspire our students. let's solve this. i have a cold... i took dayquil, but i still have a runny nose. [ male announcer ] truth is, dayquil doesn't work on runny noses. what? [ male announcer ] it doesn't have an antihistamine. really? [ male announcer ] really. alka-seltzer plus cold and cough fights your worst cold symptoms, plus has a fast acting antihistamine to relieve your runny nose. [ sighs ] thank you! [ male announcer ] you're welcome. that's the cold truth! [ male announcer ] alka-seltzer plus.

♪ oh what a relief it is! ♪ [ male announcer ] can't find theraflu? try alka-seltzer plus for fast, liquid, cold, and flu relief. try alka-seltzer plus oh, let me guess --ou see this? more washington gridlock. no, it's worse -- look, our taxes are about to go up. not the taxes on our dividends though, right? that's a big part of our retirement. oh, no, it's dividends, too. the rate on our dividends would more than double. but we depend on our dividends to help pay our bills. we worked hard to save. well, the president and congress have got to work together to stop this dividend tax hike. before it's too late. pretty sweet, huh? cute. but don't you have any apps on your phone that can make your life easier? who do you think i am, quicken loans? at quicken loans, we'll provide you with myql mobile. this amazingly useful app allows you to take pictures of your mortgage documents using an iphone or android smart phone... so you can easily send them to us.

one more way quicken loans is engineered to amaze. ooh, la-la! there's a health company that can help you stay that way. what's healthier than that? the fiscal cliff looms at the end of the month. president obama standing firm in this interview he did today with bloomberg tv. >> we're going to have to see the rates on the top 2% go up. and we're not going to be able

to get a deal without it. >> let's talk about the fiscal cliff and more with congresswoman debbie wasserman schultz of floor, chair of the democratic national committee. and the president has nominated you for another term. let's talk about the fiscal cliff. the president says the republicans have to agree to raising the marginal tax rate for the wealthiest top 2% from 35%. does he mean it has to go back up to 39.6% as was the case during the clinton administration or is there some wiggle room in between 35% and 39.6%? >> the president has repeatedly said there's room for compromise. but what this boils down to is a matter of fairness and a matter of math. giving certainty to the middle class is essential. there's no way mathematically, if you look at the republican's proposal, that you can get to the deficit reduction that we need to with preserving the

middle class tax cuts by not increasing as the republicans refuse to do the upper tier rates. there's room for discussion, but that -- >> so the 39.6%, that's not a red line? >> as far as i know and the conversations i've had, the president has said there's room for compromise, but for the red line to be drawn in the sand by republicans to say that an increase in rates on the wealthiest americans is not on the table is not fair and going to make it so we mathematically cannot get to the deficit reduction both parties we need to. >> because we are coming up with a counterproposal, raising revenue by $600 billion. >> the math does not work when it comes to making sure we get certainty for the middle class, that we get the kind of deficit reduction that you need, and you can't do it without increasing the tax rates on people who make more than $250,000.

up to the first $250,000, the rates wouldn't go up. above $250,000, they need to, because the deficit reduction that we ultimately agree to can't be done on the backs of the middle class. >> watch this, as they light the christmas tree on capitol hill. there it is. that's always a nice picture up on capitol hill. this is a 65-foot spruce that was brought in from white river national forest from colorado, harvested november 2, made the long trip, stopped in 28 communities along the way to the u.s. capital. it will be decorated with approximately 5,000 ornaments. celebrating our great outdoors. doing a little bit of music right now. let's listen in right now. ♪

>> very nice picture indeed. we're talking about serious stuff, but i wanted to show our viewers that nice holiday moment there, the christmas tree over at the capital. the british prime minister tony blair was here in "the situation room." we spoke. there are serious ramifications if we go over the fiscal cliff. listen to what he just told me. >> in the global economy as a whole, there's a lack of confidence, there's a worry about where it's going. if you can sort out this issue, then even though that doesn't sort out all the problems of the american or global economy, it would be a big boost, i think. >> i think everyone wants to avoid going over the fiscal cliff, although there are an increasing number of democrats who say we'll go over the fiscal cliff, the republicans will be blamed for that. that will be good for the democrats. >> this is not about politics but about fairness and making

sure when it comes to, as prime minister blair said, when it comes to making sure we give the global economy the certainty it needs and the stability that it needs, we have to reach an agreement so we don't go over the fiscal cliff. but quite frankly, president obama made it very clear, democrats have made it clear and the american people made it clear there has to be a balanced plan that cannot balance our reduction on the backs of the middle class. we're ready to make sure we have a balanced approach that includes spending cuts, likely voted for when the republicans played chicken with our economy last summer and we had a trillion dollars in revenue cuts only. so we've shown that we are ready to make the spending cuts necessary, and the republicans need to step up to the plate and recognize that in order to mathematically get to the size

of deficit reduction we need, without balancing that on the backs of the middle class, that they have to make sure that we increase rates on the wealthiest americans. >> if they do that, will you cut spending on medicare and medicaid? >> we need to find more savings in medicare. we already had $716 billion in the affordable care act, which added eight years of solvency. president obama proposed $316 billion in additional savings. and you can do hundreds of billions in savings. so absolutely. >> a lot of liberals in your party will vote against it if there's any significant cut in the entitlement spending. >> we know that there are savings that can be found in medicare and medicaid. but what we have to make sure of is that a priority in any deal, you don't balance this first on the backs of the middle class.

you have to make sure we have significant spending cuts, balance with an increase in rates. we can do tax reform also, but in order to get the certainly the middle class needs, we have to make sure that revenue is part of the package. >> i want to play a clip of the president from bloomberg tv today suggesting do a modest deal now, punt and do a bigger deal next year. listen. >> we're not going to be able to come up with a comprehensive tax reform package that gets it all done just in the next two weeks. we're not going to be able to come up with necessarily a comprehensive entitlement reform package in the next two weeks. when you look at what ronald reagan did back in 1986, working with bill bradley and others, that was a year and a half process. so what i've suggested is, let's essentially put a down payment on taxes, let's let tax rates on the upper income folks go up.

>> maybe next year they can work out a down payment. you've had a year and a half to do this. you knew this was coming a year and a half ago. where has been the congressional house democrats and republicans and white house leadership on this? why wait till the last three or four weeks of the year to deal with something you've known, wong come, th that's been coming up? >> many democratic leaders had to go home and defend our distributes. i represent a district that was not happy that their representative voted for $1.5 trillion in spending cuts only. democrats have been at the compromise table for all of this year and a half, as president obama has. the only way we're going to get

the significant deficit reduction is a balanced approach to spending cuts, as well as increase in the rates, a down payment as president obama talked about and we need to spend next year on some of the larger issues. >> it always comes down to the last few weeks in a tough situation we knew was coming. >> you're right, it is frustrating that the republicans are still digging their heels in and refuse to recognize that whatever plan we come up with, and we do have to have fairness and balance and it has to work mathematically and their plan does not. >> the president had nice words to say about you in nominating you for another term. you have a lot going on. >> we have a lot going on in the country and i'm privileged and honored to be with the president to continue to serve. >> we'll take a quick break. lots more news right after this. ♪

♪ ♪ [ male announcer ] everyone deserves the gift of all day pain relief. this season, discover aleve. all day pain relief with just two pills. this season, discover aleve. i've been a superintendent for 30 some years at many different park service units across the united states. the only time i've ever had a break is when i was on maternity leave.

i have retired from doing this one thing that i loved. now, i'm going to be able to have the time to explore something different. it's like another chapter. neural speeds increasing to 4g lte. brain upgrading to a quad-core processor. pre-cognitive intelligence with googlenow complete. introducing droid dna by htc. it's not an upgrade to your phone. it's an upgrade to yourself.

go to the u.s. supreme court right now. the issue of international child custody. joe johns is joining us now with details. this is a fascinating case. >> it is. tomorrow the supreme court will hear a highly personal case that crosses boarders and cultures. it could be the last chance for a father to fight for his daughter in u.s. courts. we talked to both sides in a remote area of scotland. a beautiful 5-year-old in the middle of a bitter custody battle between two parents at the end of a rocky marriage. >> my daughter, she's my sparkle. she's everything for me. >> if my daughter comes to the united states, i believe i'll

never see her again. >> reporter: it's a complicated fight, important enough that the u.s. supreme court has taken the case. the last time she was in the u.s., her father shot this video of her. but now she lives in scotland where her mother lynn is from. a judge ruled that lynn could legally take her back to sco scotla scotland, despite her father's objections. he says she shouldn't be with her mother because lynn has a drinking problem. >> personally, i don't think somebody with an alcohol issue can take care of a child. >> reporter: as evidence, he points to this 2010 police video where lynn was charged with disorderly conduct. by lynn says it was an isolated incident after a night out. >> i had too much to drink and i apologized to the court. i wasn't drunk in charge of my

child. >> reporter: it's a classic he said, she said. >> i believe he set me up. >> reporter: lynn accuses jeff of unwant eed controlling behavior. >> he called the police on me on christmas eve and i was removed from the house. i was taken to jail. >> reporter: something he denies. >> how could i get her deported? how is that possible? >> reporter: telling a totally different story. >> i woke up with her standing over me with a knife. >> reporter: why would the supreme court get involved? there's a treaty called the hague convention that says a child in the middle of a custody battle goes to the habitual resident. >> what is the ordinary, regular home of this little girl? >> reporter: and what is it? >> scotland. >> reporter: the federal court agreed that's where she belonged. but jeff's lawyer argues the judge got it wrong.

the question is whether lynn intended to stay in the u.s. with her family. >> the phrase miscarriage of justice comes to mind. >> reporter: but the main issue for the supreme court is if jeffs can appeal the decision now that she's out of the country. you've got to have that next level of review. >> this is a case that has immediate significant long lasting impact for every parent in america. >> reporter: though most likely for military families and families who travel overseas, ultimately lynn's lawyer says it comes down to this. >> the welfare of the child is not good for a child to be like a ping-pong ball going backwards and forwards between different countries. >> reporter: important to say that the treaty that affects this case is mainly designed to help children who have been abducted from their home country. this is a slightly different scenario. it's caught the attention of two republican senators but neither office would say they would address the issues, because passing a bill to circumvent a

treaty would be controversial on the hill and suspect in the court. >> we'll see what the justices decide. thank you very much. top governors sit down with president obama at the white house to discuss the fiscal cliff. did they find any common ground? bp has paid over twenty-three billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are open, and many areas are reporting their best tourism seasons in years. and bp's also committed to america. we support nearly 250,000 jobs and invest more here than anywhere else. we're working to fuel america for generations to come. our commitment has never been stronger. trust duracell to power their donated toys? duralock power preserve. it locks in power for up to 10 years in storage. guaranteed. duracell with duralock. trusted everywhere.

a bipartisan group of governors, three democrats, three republicans, are urging both sides to reach a deal to keep from going over the so-called fiscal cliff. they met privately with president obama over at the white house today. among the governors, the utah republican governor, gary herbert. he's joining us now from capitol hill. governor herbert, thanks very much for coming in. take us inside that room, if you can. what did you learn from that

meeting that you didn't know going in? >> i don't know if we learned a lot different, but it was nice to have the governors invited to be in the room. we sometimes have been ignored and underappreciated. and i think we have something to offer to help them solve some of the policy issues. >> are you more or less confident that we will avoid going over the fiscal cliff? >> i've got some concerns that they're still a ways apart. states are trying to do their part by doing more with less. we recognize it's a shared sacrifice. we're prepared to take less money and we ask to give us more flexibility. we can do more with less as a state. >> what does that mean, more flexibility? explain. >> well, money comes with strings. the more strings, the less flexibility. for example, our contractors that build roads in utah say it cost about 30% more money, more cost to build a road under a federal program, a federal money, than with state money. that's because of strings. >> did you make that point to the president? >> we did. in fact, we offered, with medicare reform and some of the

health care issues, we've presented some waivers, as the state of utah, and we've said, if you'll give us more flexibility, we can take less money, get a better outcome, help you balance your budget, and not tank the economy in the process. >> what did he say? >> he's willing to look at flexibility. in fact, encouraged us to come back with some recommendations, with some ideas with not only medicaid, with education, with transportation, other government programs, where we're partners with the state, and say, here's a better way to do things. >> because i remember, during the campaign, and you probably remember it a whole lot better than i did, when it came to welfare reform, the president cited two republican governors out there who wanted more flexibility as far as welfare reform was concerned. you were one of those two republican governors with governor sandoval. did that issue come up today? do you have any regrets about what was said at time? because some of your fellow republicans weren't very happy with you. >> no, it didn't come up. but the concept of more flexibility, finding states as laboratories of innovation and

creativity, finding better ways to do things is a concept that everybody ought to embrace. it's not a partisan issue. if we can find better ways to do things and save money, we ought to do it. whether it be welfare reform, whether it be building roads and transportation, whether it be health care, whether it be education. and, again, states are prepared to step forward. let us do what we do best. we'll find innovative ways to create better outcomes. >> have you decided whether utah will participate in what's called those state-run health care exchanges under obama care? >> we already have a health care exchange. we had a health care exchange way before the affordable care act was ever passed. we have a state exchange. we are taking a very careful look to see if we can maintain our state exchange. some of the mandates, some of the requirements give us pause. i'm going to explore that with secretary sebelius, and see if we can maintain it, or do we have to turn it over to the federal government. >> sounds, though, like the conversation was a positive conversation with the president.

you were happy you went? >> i am happy. again, it's nice to be invited is. we've been ignored too much. i feel good about not on the conversation with president obama and vice president biden and 13, but we met with speaker boehner today and majority leader reid. i feel the same way, that at least they're listening to us for the first time, at least in my history here, about a very significant issue. so we hope to be a catalyst for good. >> let's hope for the best. governor, thanks so much for joining us. >> thank you very much. sounds like military make believe, but it's not p. up next, new camouflage. stay with us.

of washington about the future of medicare and social security. anncr: but you deserve straight talk about the options on the... table and what they mean for you and your family. ancr: aarp is cutting through all the political spin. because for our 37 million members, only one word counts. get the facts at earnedasay.org. let's keep medicare... and social security strong for generations to come. if we want to improve our schools... ... what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ... nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students. let's solve this.

yeah we both relieve coughs, sneezing, aches, fevers. and i relieve nasal congestion. overachiever. [ female announcer ] tylenol® cold multi-symptom nighttime relieves nasal congestion. nyquil® cold and flu doesn't. the army and navy are using some extraordinary new camouflage technology that can make troops disappear.

here's cnn's chris lawrence. >> well, wolf, the army could soon be making a decision on its next generation of camouflage. but i've got to tell you, you won't believe where this technology is headed. >> camouflage can be the difference between a soldier getting shot and going home. so lots is riding on the next generation design to outfit troops. it's only been eight years since the army spent $5 billion on m camo that critics say didn't fool anyone. soldiers complained to the point where the army abandoned its one size fits all universal pattern. so they were looking for camouflage they can use everywhere? >> correct. and it didn't work anywhere. >> reporter: guy cramer is one of the designers competing to win the army's next multi-million dollar contract. he showed us the science behind every shape, size, and shade of these pixels.

>> you now have your camouflage. we're trying to trick the brain into seeing things that aren't actually there. >> reporter: digital patterns recreate shapes already found in nature, and 3-d layering creates depth and shad dose where none exist. that's today's design. but developers already have one eye on tomorrow. >> what's coming up down the road and very quickly is the harry potter cloak. >> what is that? >> reporter: with that fictional cloak, harry isn't just camouflaged, he's invisible. >> my body's gone! >> how invisible are we talking here? if i walked into a room with a soldier wearing one of these cloaks -- >> you wouldn't see him at all. he would be completely invisible to you. >> reporter: this isn't make believe. the military has seen the so-called quantum stealth technology. it works by bending the light around an object, even concealing most of a person's shadow. imagine what that could do for a sniper, hiding in a field, or

the american pilots who ejected over libya when their fighter jets crashed last year. >> they could actually pull out very similar to what they carry with a survival blanket, throw it over top of them, and unless you walked right into them, you wouldn't know they were there. >> reporter: so what was once firmly in the world of make believe could quickly become quite real. >> reporter: the science is in the special fabric, so you don't need a power source or some instruction manual to make it work. theoretically, any soldier, even in the most remote location, could quickly put it on and get it working. wolf? and happening now, violent clashes as protesters try to storm egypt's presidential palace. is another revolution unfolding right now? before the david petraeus scandal, the head of fox news reportedly had a secret plan to try to make the general president of the united states. and a shocking front page photo of a man's subway death.

critics say it crosses a dangerous line. i'm wolf blitzer. you're in "the situation room." up first this hour, president obama lays out his latest bargaining position in the struggle to avoid the so-called fiscal cliff. he only has 28 days the left to reach a deal with the republicans in congress before automatic spending cuts and tax hikes take effect. but instead of private negotiations, he's on thing for a public appeal. let's go to our chief white house correspondent, jessica yellin, for the latest. jessica? >> reporter: hi, wolf. that's right. today, president obama went public, rejecting speaker boehner's proposal for a deficit reduction plan and insisting that any deal must include a proposal to increase rates for the wealthiest. he did it all in a tv interview.

what does president obama think of speaker boehner's proposal to avert the fiscal cliff. >> unfortunately, the speaker's proposal right now is still out of balance. you know, he talk, for example, about $800 billion worth of revenues, but he says he's going to do that by lowering rates. and when you look at the math, it doesn't work. >> reporter: and he won't agree to eliminate a tax deduction for contributions to charity. >> every hospital and university and not-for-profit agency across the country would suddenly find themselves on the verge of collapse. so that's not a realistic option. >> reporter: but the president didn't say all this to speaker boehner. he said it in an interview on bloomberg tv. the last time the two men spoke was almost a week ago. president obama is focused on the stalemate with congress over averting the fiscal cliff, but he's just not talking to house republicans about it. at the white house, he discussed

the issue with a bipartisan group of governors. >> i know that the president certainly wants a deal. and he didn't try to handicap it. >> reporter: and earlier this week, he told so-called middle class americans on twitter, "keep pressure on congress." he's even ventured outside the beltway, rallying supporters to do just that. >> i'm going to be asking for all of you to make your voices heard. >> reporter: why isn't he calling speaker boehner over for a white house meeting? >> speaker boehner and i speak frequently. and, you know, i think the issue right now -- >> so, when? when will the two of you sit down in a room? >> you know, i don't think that the issue right now has to do with sitting in a room. >> reporter: in part, the white house was burned by the debt ceiling negotiations of 2011, when lots of meetings failed to stave off a fiscal nightmare. but there's another strategy at play. some in the administration say they learned in the first term the best way to break washington stalemates, rally the public to

their cause. here's how the president put it to cbs news. >> so getting out of this town, spending more time with the american people, i need to do a better job of that in my second term. >> a better job of explaining? >> well, explaining, but also inspiring. >> now, wolf, for now, negotiations between the white house and congressional republicans are on deep freeze. at the white house, they are just waiting for the republicans to blink and agree to raise rates for the wealthiest. republicans are waiting for the white house to blink and agree that that won't be part of the deal. neither side is budging, so right now, you have after staring contest. wolf? >> and they're staring intensively. there's only a few weeks left. thanks, jessica, thanks very much. kate balduan is here. she's monitoring some of the other stories, including growing violence going on in cairo right now? >> anti-violence protesters got close to the palace today.

look at that video. cnn's reza sayah was at the presidential palace today and he's joining us now live. reza, you were there, you were among the protesters. what did you see? what did you hear? what's the latest? >> reporter: for about an hour, there was some tense moments, kate, outside the presidential palace. that's where protesters started throwing rocks, debris, and they broke through a barrier set up by security forces. they got close to the palace. police responded by firing tear gas. the question was, would things get uglier? would things escalate? they did not. police changed their strategy, they retreated, they went back behind palace walls and immediately things started to calm down. at no point was there any indication that the president was in danger, according to state media. he left to a safer location and the protests continued outside the palace. these are the opposition factions, the liberals, moderates, women's rights groups who feel that they've been sidelined by the president and

the muslim brotherhood in the process by which this draft constitution was written, kate. >> and i think it's been really kind of rushed through as they've all been standing by, watching. and reza, there sure doesn't seem to be any end in sight to these protests. they're very passionate. does the opposition really have any other option, though, other than simply protesting? >> well, that's the big question. the way things look like right now, the momentum has shifted in favor of the president, of course. he has executive powers. he's inherited legislative powers. he has additional powers with those controversial decrees. and his position is, people should go out and if they don't like the constitution, vote no on december 15th. and his position is, if they vote yes, all those additional powers will be immediately an l annulled. he's hoping that's going to calm down the opposition factions. it doesn't look like they have a lot of options other than protesting. that's what they continue to do at this hour, kate. >> reza sayah on the ground for us in cairo. thanks so much, reza. >> let's talk a little bit more

about what's going on in egypt right now. the cycle of protests, the an anti-government anger. we're joined now by fooud brown. >> even as the international community obviously applauded egypt's efforts in bringing about the cease-fire in gaza, there is concern and anxiety about what's happening there. >> so are we on the verge of another revolution in egypt? >> you know, wolf, it's very interesting. now, we know that president morsi has a ph.d from the university of southern california in structural engineering. we know that he may be a very good engineer, but he sure is a very poor politician. you get elected with 57% of the vote, now you have a polarized, divided country, and then you impose these emergency powers on november 22nd. and listen to this. figure this out. on november 22nd, he grants the constitution assembly that's drafting the constitution two more months, and lo and behold,

a week later, on november 29, this constitutional assembly, without women, without secularists, without cops, gives the country a new constitution. it's not a very brilliant democratic game to play. >> so what do you see unfolding in the weeks and months to come as far as president morsi is concerned? >> well, look, i think morsi has plaid his game and i think reza was absolutely right. basically the argument with morsi is, you folks need to wait. and on december 15, you can vote. you can vote this constitution up or down. and see, there's kind of a great irony about this. i mean, he rushed this constitution in order to rid himself of the very constitution, of the very power he claimed in that constitution and declaration. it's a model. it's a model. i think that there is a fight in egypt over the so-called january 25 revolution that overthrew hosni mubarak. to whom does this revolution belong? does it belong to the

brotherhood or does it bloelongo the revolutionists, the young people who went out in tahrir square, night after night for 18 days, and brought down the dictatorship of hosni mubarak? >> and, you say that president morsi isn't a very good politician. the whole world is watching egypt and watching the beginnings of this new democracy working. when you look at president morsi, do you see him trying to work, albeit a flawed democracy, or is he working towards something else, like a dictatorship? >> you know, kate, we really don't know. this is the big monumental question about the muslim brotherhood. do they see democracy as a means to capture power or do they believe in it? do they believe in democracy? that is the question that needs to be answered, that's begging for an answer. not only in egypt, but in tunisia, in other places where the islamists come to power. it is, are they devoted to democracy or are they devoted to the rule of sharia. and what you have now, is they

believe they want -- i've read this, they want bread, freedom, and sharia law. well, that's not exactly what the secular, the liberals had hoped for. >> when you look at the political situation in egypt, kind of beyond president morsi, do you think the situation would be any different if there was a different president? i mean, there was so much talk of mohammad al baredy, if he would have been president? >> we really don't know what the real answer to this is. we do know that the liberals split their votes. they split their vote in the first round of the elections. and you ended up with this odd outcome. you ended up in the second round, the ultimate round, with a man from the mubarak years against the muslim brotherhood. so i think it was really the liberals, the constitutionalists, the secularists who really divided their own ranks and made their own life very difficult. >> it seems like the whole region in north africa, the middle east is the in turmoil right now. is this still the arab spring

we're talking about or have we moved on to something totally different? >> well, i think, you know me, wolf, i am true blue to this arab spring. i believe in this democratic wave. it's very difficult. i think we're witnessing in many ways, and it's not really spin that i say here. we're witnessing the delayed consequences of decades of dictatorship, decades of dictatorsh dictatorship. six decades of dictatorships in egypt. and four decades of tyranny in libya. and on and on. i mean, these countries in the arab world had been badly governed for decades. and once you remove the lid, all the contradictions and frustrations of these societies come to the surface. thank you very much for joining us. >> thank you. the fox news chief, roger ailes, is getting some heat right now. he reportedly tried to recruit general david petraeus as a republican presidential candidate. we'll take a look at the secret

talks and the ethical questions involved. stay with us. then no one will want to steal the deliciousness. with a variety of tastes and textures only chex mix is a bag of interesting. you won't take our future.

aids affects us all. even babies. chevron is working to stop mother-to-child transmission. our employees and their families are part of the fight. and we're winning. at chevron nigeria, we haven't had a reported case in 12 years. aids is strong. aids is strong. but we are stronger. and aids... ♪ aids is going to lose. aids is going to lose. ♪

aids is going to lose. capella university understands back from rough economic times.. employees are being forced to do more with less. and the need for capable leaders is greater than ever. when you see these problems do you take a step back, or do you want to dive right in? with a degree in business from capella university, you'll have the knowledge to go further in your career than you ever thought possible. let's get started at capella.edu [ female announcer ] some people like to pretend a flood could never happen to them. and that their homeowners insurance protects them. [ thunder crashes ] it doesn't. stop pretending. only flood insurance covers floods. ♪ visit floodsmart.gov/pretend to learn your risk.

the former cia chief, david petraeus, is back in the news today, but not because of his resignation or his extramarital affair. we're now learning about a secret attempt to encourage general petraeus to run for the republican presidential nomination and the chairman of fox news reportedly was behind the idea. our national political correspondent, jim acosta, is joining us with more information. what are you learning, jim? >> wolf, apparently this proposal was made before david petraeus was tapped to run the cia. and this all goes back to the fact that some republicans were longing for alternatives to the official gop candidates in the race, and as an audio recording reported by "the washington post" reveals, fox news chief roger ailes appears to step out of the role of a traditional news executive to recruit a potential alternative. before the extramarital affair that just last month forced david petraeus to step down as director of the cia, he was so popular in republican circles

that roger ailes, the chairman of focus news, tried to enlist the four-star general to run for president back in 2011, according to a recorded conversation obtained by "washington post" reporter and author, bob woodward. >> i'm not running. >> making the pitch to petraeus is k.t. mcfarland, a fox news national security analyst. mcfarland tells the journalist ailes was willing to give up his job at the network to run a campaign. >> if i ever ran, i'd take him up on his offer. he said he would quit fox -- >> and i know. >> -- and bankroll it? >> bankroll it? >> maybe i'm confused and that was rupert. >> i know roger has done okay. but i think the one who is bankrolling it is the big boss. big boss is bankrolling it. roger is going to run it. and the rest of us are going to

be your in house. >> reporter: that big boss is rupert murdoch, head of news corp. but petraeus repeatedly shuts down the idea. >> my wife would divorce me. >> reporter: after petraeus later accepted the job at the cia, mcfarland went on fox to talk about her conversation with the general. but she never mentioned the ailes offer. >> i think that petraeus doesn't want to run. i asked him that question and he said, i'm not running for president. >> reporter: ailes told "the washington post" that he did ask mcfarland to approach petraeus, but added, it was more of a joke, a wise-a ass way i had. it sounds like she thought she was on a secret mission in the reagan administration. she was way out of line. >> the idea that rupert murdoch might bankroll a petraeus candidacy, not that far fetched, given the fact that murdoch has given on occasion seven-figure fums to the republican party.

murdoch repeatedly injected himself into the race, saying on twitter last july, "met romney last week, tough chicago pros will be hard to beat unless he drops old friends from team." and, "romney people upset at me, of course i want him to win. save us from socialism." >> you do have people over there that had candidates that they weren't shy about saying stuff for. >> by the way, that operative there, john brabender, who you just saw, he works for rick santorum, who, by the way, meets with roger ailes later this week. as for ailes, we reached out to the network for a comment, but did not get a response. >> rick santorum was a fox news contributor. newt gingrich was a fox news contributor. several of those republican presidential candidates. and i guess, the question is, it's one thing for rupert murdoch. you know, he's a big shot. he can get involved in politics, but for a news executive to get involved, that raises a whole set of other questions out there. >> that's right. you know, that sort of gets into this world of questions about

fox news and its role in news. are they a news organization or are they, as many democrats suggest, an arm of the republican party. i know you asked paul begala and mary matalin about this earlier this afternoon. and this ignites fierce debate. but i will tell you that having talked the to a lot of republican operatives during that campaign, there were some who felt, you know what, we don't always get a fair shake from fox, if we're not their selective candidate. we're not the candidate we have out there. and one of the top tier rp candidates there at the very end of this contest say to me, personally, hey, i feel like i didn't get a fair deal from them. they were out there, basically in the tank for the other guy. >> but if you listen to the audio on washingtonpost.com, that conversation that k.t. mcfarland had with general petraeus, it is pretty stunning when you hear it. she didn't think it was a joke. she was taking it very, very seriously. she's a former high-ranking official in the defense department during the bush administration. >> that's right. and as you see in our piece, she went on fox news a couple of

days later, after petraeus was tapped to head the cia and basically recounted much of what was said during that discussion. but at the same time as we're all talking about partisan media and so forth, keep in mind, you know, the prime-time pundits and anchors over at msnbc were over at the white house this afternoon, meeting with president obama on the administration's proposals for getting the fiscal cliff passed up on capitol hill. so, you know, i would say a lot of republicans who would look at this story say, hey, wait a minute, we're just doing what the other guys are doing. which is why msnbc got into the business that they're in. they're doing, hey, we're doing what fox news used to be doing all the time. >> and the circle continues. >> not us, though. >> not us. jim acosta, thanks so much. parts of the midwest being torn apart by a vicious mix of wind, rain, and even snow. up next, we'll go live to the scene of this massive sinkhole, just look at that, where the worst could be yet to come. ♪

[ male announcer ] shift the balance of power decisively in your favor. the exclusive eight-speed transmission and rotary shifter in the new 2013 ram 1500. engineered to move heaven and earth. guts. glory. ram.

a series of storms is pummeling the pacific northwest right now, with more bad weather on the way. kate's back. she's got that, some of the day's other top stories. what's going on? >> it's pretty amazing stuff, wolf. another storm hit washington, oregon, and northern california today and more heavy rain is expected to pound the region through tomorrow. flooding is causing problems like sinkholes. cnn's dan simon is standing in front of a huge one in lafayette, california. dan, another round of storms is coming, as wolf said. can that rain-soaked area handle anymore rain? >> reporter: well, it's just a mess, kate, and the forecast is bad news for these rain-soaked communities. let me explain where i am. i'm in lafayette, california,

standing inside a sinkhole. this is pretty dramatic. it's 80 feet long, 40 feet wide, 15 deep. let me explain how this happened. the water was gushing beneath the road here. there's a creek. and basically, the soil just ripped away and it caused the street to cave in. crews have been working all day, trying to clear out these large chunks of concrete. they also had to create these alternative lines, these temporary lines for water and sewage to service this neighborhood, so they didn't, you know, go without basic services. the weather has been terrible here in the bay area for the last week. we had three major storms. we're expecting a fourth storm tonight. so some more rain is really the last thing this community needs. there have been all kinds of problems, besides this sinkhole. there have been a lot of power outages. at one point, 340,000 people in this region without power. so we hope we don't see repeat of that tonight, kate. >> yeah, clearly, they cannot handle anymore of that rain.

dan simon in california for us, thanks so much, dan. also, angry drivers are taking matters into their own hands. they say they were caught by red light cameras because the yellow lights are purposely timed too short. now three plaintiffs are filing a class action lawsuit, seeking to end the camera program and refund all of the money it collected. it claims the cameras are dangerous and illegal. new york says all traffic lights in question are properly timed. do not get me started about red light cameras. >> we will not do that. >> thank you very much. >> thank you. other news we're following, including iran. it's bragging that it's captured another u.s. spy drone. but who does it really belong to? the photos, the theories, next. can tow up to 9,600 pounds? 315 horsepower. what's that in reindeer power? [ laughing ] [ stops laughing ] [ male announcer ] chevy's giving more. this holiday season, trade up to get the 2012 chevy silverado all-star edition for 0% apr financing for 60 months

plus $2,000 cash allowance or get a total value of $9,000. it's so great to see you. you, too! oh, cloudy glasses. you didn't have to come over! actually, honey, i think i did... oh? you did? whoa, ladies, easy. hi. cascade kitchen counselor. we can help avoid this with cascade complete pacs. see, over time, cascade complete pacs fight film buildup two times better than finish quantum. to help leave glasses sparkling shiny! too bad it doesn't work on windows. okay, i'm outta here. cascade. the clear choice. okay, i'm outta here. and you see the woman you fell in love with. she's everything to you. but your erectile dysfunction - that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about

all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. do not take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. do not drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or if you have any allergic reactions such as rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a 30-tablet free trial. and the candidate's speech is in pieces all over the district. the writer's desktop and the coordinator's phone are working on a joke with local color. the secure cloud just received a revised intro from the strategist's tablet. and while i make my way into the venue, the candidate will be rehearsing off of his phone. [ candidate ] and thanks to every young face i see out there. [ woman ] his phone is one of his biggest supporters.

[ female announcer ] with cisco at the center... working together has never worked so well. the nato secretary general is promising an immediate reaction if syria unleashes chemical weapons into its civil war, and the alliance is going to give turkey new means to protect itself. approving the deployment of patriot air defense missiles

along its border with syria. jill dougherty is at nato headquarters in brussels. >> wolf, nato insists that the deployment of patriot missiles is defensive only, not part of any plan for a no-fly zone over syria. at nato headquarters in brussels, the alliance gives the green light for deploying patriot missile air defense systems to turkey, to protect that ally against possible attack from syria, including any possible use of chemical weapons. >> the nato ministers unanimously expressed grave concerns about reports that the syrian regime may be considering the use of chemical weapons. any such action would be completely unacceptable and a clear breach of international

law. >> the move comes amidst u.s. concerns that the assad regime may be, quote, cooking up recipes, mixing materials for chemicals. that possible preparation is taking place at more than one chemical plant in syria, officials say. u.s. intelligence shows nothing has been moved out of the facilities, however, and officials say there is no indication syria is on the verge of using chemical weapons. in turkey monday, russian president vladimir putin called the deployment of patriot missiles unnecessary. syria, he said, is far from plotting any attack on its neighbors. it is absolutely unrealistic. but tuesday at nato, russia's foreign minister, sergei labrov downgraded rumors about syria. >> translator: we can call them

leakage that they are moving the weapons or that they want to move those weapons. as soon as we hear such messages, we respond in demonstratives. >> reporter: secretary of state hillary clint hillary clinton spent the day meeting with her fellow ministers. nato says the number of patriot missiles and their precise location along the turkish/syrian border still needs to be worked out. it could be weeks before the equipment is in place. u.s. officials insist the intelligence about syria's chemical weapons was strong enough to warrant president obama's warning. but they say, at the moment, there is no imminent planning for any u.s. military action. wolf? >> jill dougherty, thanks very much. on top of all of this, kate, there's another dispute now between the u.s. and iran. >> at issue is the claim that iran has seized one of america's most effective weapons. brian todd has been looking into this. brian, what did you find out? >> wolf, kate, this is another

issue in what many call between the shadow war between iran and the united states. now, drones are a big part of that, and now there are claims and counterclaims about this capture and who this drone really belongs to. >> reporter: iranian authorities display what they say is a captured american drone. according to iranian officials, it was spotted carrying out, quote, spying operations in the persian gulf in recent days. u.s. officials say it's not an actively operating u.s. navy drone and doesn't belong to the cia. the white house says -- >> we have no evidence that the iranian claims you cite are true. >> reporter: the iranians say the unmanned aerial vehicle is a scan eagle, a small drone made by a boeing subsidiary named insitu. it's only 4 feet long with a 10-foot wingspan. iranian officials say the one they display was captured by revolutionary guard anti-aircraft squad. would it take an anti-aircraft squad to bring one of these down? >> brian, that's hard to

believe, because this is a very small uav. it weighs in at 40 pounds, on average. so the idea that some kind of artillery piece would blast this thing out of the sky doesn't seem believe because that would shatter it to bits. >> reporter: lee and other experts tell us the drone on display in iran could have been downed by weather or a navigation problem. a year ago, iran claimed to have shot down another u.s. drone, the high-altitude rq-170 sentinel. u.s. officials said it had crashed in the iranian desert after leaving a base in afghanistan. either way, the iranians were so pleased with the thing, that they created a toy model out of that drone. this one comes in a cool pattern in pink. on the box, the words "captured by the iranian muslim youth," and for good measure, "we will crush america." experts say the drone now on display ain't like this one. >> reporter: experts say the scan eagle would not fly deep into iranian air space to possibly spy on nuclear

facilities. it's so low-tech, it can be launched by a catapult and caught with a rope. it might scan for smugglers or aggressive military boats. >> this little usa vuz first developed for use by fisherman to watch tuna fleets. >> reporter: but if this isn't america's drone, who is it? cnn contacted insitu. they told us their clients include seven countries outside the u.s., but didn't mention any in the middle east. one possibility in that region -- >> i have seen some reports that uae may have these scan eagle drones and i did see insitu, which makes the scan eagle in partnership with boeing put out a press release in 2011 saying that it had partnered with a company in abu dhabi to manufacture spare parts and some services for scan eagles. >> we could not get response from uae officials or insitu to our inquiries over whether uae possesses that drone, makes parts for it, or does anything else with it, kate. >> if they have this drone, it's

a real drone. what kind of information could they learn from it, that could potentially be useful? >> experts say not a lot of information, not a lot of technology they could get out of it. some of the infrared technology is pretty good, can take good pictures, high res, things like that, and the capability of packing that into such a small frame is something the iranians could learn how to build from this. >> we can't let you go until you show us what you're obviously getting your kids for christmas. >> this is that toy, the irans made a toy out of it. that marketed it last year after they captured this american drone, the rq-170. it says, "american hedgemoni" on the box. >> captured by the irani muslim youth. >> a very popular item. >> they call it the rq-170. >> they sure do. >> great job. there's growing speculation that the actress ashley judd is

actually considering a new role challenging the republican leader in the senate. is this hype? is it for real? what's going on? stand by.

[ "the odd couple" theme playing ] humans. even when we cross our "t"s and dot our "i"s, we still run into problems -- mainly other humans. at liberty mutual insurance, we understand. that's why our auto policies come with accident forgiveness if you qualify, where your rates won't go up due to your first accident, and new car replacement, where if you total your new car, we give you the money for a new one. call... to talk to an insurance expert about everything else that comes standard with our base auto policy. [ tires squeal ] and if you get into an accident and use one of our certified repair shops, your repairs are guaranteed for life. call... to switch, and you could save hundreds. liberty mutual insurance -- responsibility.

what's your policy?

this is really an amazing story. the internet security pioneer john mcafee has now turned up in guatemala and says he will seek asylum there wednesday. >> that's tomorrow. he's being sought by authorities in belize for questioning about the fatal shooting of his neighbor in november. >> as we reported yesterday, he denies any part in the killing and recently did an exclusive interview with cnn's martin savage. martin is joining us on the phone right now. do we know how he got into guatemala, martin? >> reporter: no, we don't. i mean, when we met with him on friday, and even in the

conversations on the telephone leading up to that interview, wolf, he gave every indication that he might be running. he wouldn't say where he was going. mexico seemed likely, because of its close proximity, but then once we sat down and met with him and realized that his girlfriend was from guatemala, well, it sort of rang in my head that that was probably the way that he was going to go, because then she would have connections. he did imply that if he did run, it was going to be a journey probably by water and he said it was going to take him about three days. but, you know, with john mcafee, he says a lot. how much of it is really true, you never really know unless you're there with him. so it's hard to say. he will certainly say a very arduous case, but since he's not really wanted, how much of a dangerous escape it was, it's only in his mind. >> and martin, as we've said, mcafee will be seeking asylum in guatema

guatemala, so what's that mean for belize authorities that are still pursuing him? >> reporter: it's an interesting question. it's one i put to the authorities. i said, what would happen, how would the posture of your investigation change? and they said, well, it really wouldn't. although, even just now, when we questioned the authorities down there in belize, they say they have reliable police information that tells them that he did not leave the country, which is kind of interesting, because i also had a conversation with a very close friend of his, and she also said, you know, he is a master of deception. he may not have left the country. you have a photograph of him, of course, with him meeting his attorney, but did he really go? i don't know. there's all this subterfuge that people put out there and leave you guessing. but authorities in belize say it would not change their investigation nor would it change the charges against him, at least so far. >> and when you were in belize, you had some of your own equipment there stolen? what happened? >> reporter: well, less than 24 hours after having our interview with john mcafee, someone got into my hotel room and stole my

laptop computer and my iphone. what was interesting was, they left the chargers behind for both, even though they were connected. in other words, somebody wanted just the devices. if they wanted to resell them, i thought they would take the power cord. so i don't know. it certainly adds just more curiosity to a case that has no shortage of it, wolf. >> certainly does. martin savage on the scene for us, as he always is. thank you. other news, including the most powerful republican in the united states senate, he might be facing a surprising challenger in two years, if you believe all the speculation that's out there. there's talk that the actress ashley judd is considering whether to run against the senate minority leader, mitch mcconnell. here's cnn's entertainment correspondent, nischelle turner. >> i'll think about it. >> reporter: senator ashley judd? the star of the tv series "missing" may try to make it her next role. >> i enjoy coming to washington. >> reporter: according to politico, the hollywood star is

seriously exploring a run for senate in her home state of kentucky. in the 2014 midterm election against senate minority leader, mitch mcconnell. >> i am very proud to be a kentuckyian. >> reporter: politico says she even discussed the idea with democrats in congress. cnn political editor paul steinhauser says either way, her star power is a big plus. >> she is well known across the country and in kentucky. she'll probably excite democrats and especially liberals across the country. that could equal a lot of money. >> reporter: judd, an outspoken supporter of president obama, is no stranger to the political scene. she was a tennessee delegate at the democratic national convention in september and is widely recognized for her work in environmental and social issues. the actress has devoted her time to fighting poverty in third world countries. as a board member of population services international, a d.c.-based group with programs worldwide targeting issues like malaria, hiv, and reproductive health. but her stance on one

environmental issue in the eastern kentucky appalachians could have an impact on any potential bid for senate. >> i hope you will commit your journalistic integrity to stop mountaintop removal immediately. >> reporter: judd is a critic of a method where companies remove the tops of mountains, usually with explosives, for easier access to coal. >> the preciousness of these mountains is a natural endowment that should be treated as sacred. >> reporter: and let's not forget, she would be running against the most powerful senate republican. >> he's got deep roots in the state. he's got a very powerful machine there. so any democrat, be it ashley judd, or anybody else, is going to have a very, very big uphill challenge against mitch mcconnell in the midterm elections. >> reporter: nischelle turner, cnn, hollywood. >> a spokeswoman for judd had no comment, but referred cnn to a statement it released last month when reports surfaced that the actress might consider a move to politics. then judd said she was honored by the consideration.

she noted that the 2012 election had just ended. she didn't rule out the possibility of a senate run in the future. let's see if she's interested. >> that's absolutely right. "erin burnett outfront" starts at the top of the hour. erin, we hear you've arranged quite the debate over whether republicans should compromise on taxes. give us a preview. >> we are going to have both sides of that. grover norquist, of course, already our guest. he's going to say, we shouldn't have tax increases in this country no matter what, no matter how, no way. then we'll have republican tom cole on, who broke ranks with the republican party, who says, let's extend the bush tax cuts for people making under $250,000 a year and do the rest of it later. something sort of like what the president had put forth. so both of those sides tonight. and then we'll talk about the movie "zero dark 30," already getting oscar buzz, about the raid and capture of osama bin laden. there was all of this concern about whether there was classified information that was linked to the filmmakers that could put the u.s. in jeopardy. we have a special report on what

information was leaked. >> looking forward to it. erin burnett, thanks. it started with a fight in the subway and ended with a man's death and a front-page photo that makes the story even more shocking. [ telephones ringing ] at chevy's year-end event, we have 11 vehicles that offer an epa-estimated 30 mpg highway or better. yeah? hey. hey. where's your suit? oh, it's casual friday. oh. [ male announcer ] chevy's giving more.

now get a 2013 malibu ls for around $199 per month, plus competitive lessees can get $1,000 toward the down payment for an even better deal. i have a cold, and i took nyquil, but i'm still "stubbed" up. [ male announcer ] truth is, nyquil doesn't unstuff your nose. what? [ male announcer ] it doesn't have a decongestant. no way. [ male announcer ] sorry. alka-seltzer plus fights your worst cold symptoms plus has a fast acting decongestant to relieve your stuffy nose. [ sighs ] thanks! [ male announcer ] you're welcome. that's the cold truth! [ male announcer ] alka-seltzer plus. ♪ oh what a relief it is! ♪ [ male announcer ] to learn more about the cold truth and save $1 visit alka-seltzer on facebook. there's a health company that can help you stay that way.

what's healthier than that?

the "new york post" is certainly known for sensational front page photos and headlines. >> but today's cover showing a man just moments before a subway train killed him is especially outrageous. so is the story behind it. mary snow is looking into it for us. mary, what are you finding out? >> reporter: well, kate, police are now questioning a 30-year-old man after canvassing surveillance videos. they say they spotted him on video helping street vendors and found him not far from yesterday's tragedy.

>> [ bleep ]. >> reporter: why exactly these men were fighting is unclear. but moments after this video obtained by the new york police was recorded, 58-year-old keysa khan, whose face is obscured, was pushed on to the tracks, police say, by the man yelling at him. a subway barreling through the station killed khan with horrified onlookers unable to save him. >> i know they were arguing with each other and stuff. and i saw people trying to flag the train down before the train got to him. >> reporter: the fight happened around 12:30 in the afternoon on this platform only about ten feet wide. a doctor on the platform says the victim was trying to protect people that he didn't know. and she says that many people tried to help him by alerting subway personnel. the victim was struck, and she says she performed three to four minutes of chest compressions on him, but it was too late. one eyewitness describes the train coming to an abrupt stop three quarters into the station.

>> people are just standing in fear and shock not knowing what's going on. some people started running out of the platform and other people just stood there and really didn't know what was going on. >> reporter: the suspect, mean time, was able to slip out of the station into times square. and police canvassed the area with his image, placed on wanted posters placed in the streets. but it was another image in this cruel killing that sparked an uproar. this is one of several photographs published by the "new york post" of hahn facing the train seconds before his death. the post quotes the photographer saying he tried to warn the operator firing off his camera flash. but online, there were comments of disgust. wow, enough time to take a few pictures. why didn't the person help? what an age we live in, when getting the picture is more important. i am appalled. we reached out to the photographer, and the "new york post" but both declined our request for comment. as for hahn, he is among the

more than 5 million people who ride the new york city subway on any given day. police tell us, he was on his way to the korean consulate to get his passport renewed. kate and wolf? >> such a tough story. mary snow, thank you so much. still ahead, the world more -- more on the world's most-watched pregnancy. [ male announcer ] introducing zzzquil sleep-aid. it's not for colds, it's not for pain, it's just for sleep. because sleep is a beautiful thing. ♪ zzzquil, the non-habit forming sleep-aid from the makers of nyquil. zzzquil, of washington about the future of medicare and social security. anncr: but you deserve straight talk about the options on the... table and what they mean for you and your family.

ancr: aarp is cutting through all the political spin. because for our 37 million members, only one word counts. get the facts at earnedasay.org. let's keep medicare... and social security strong for generations to come. bp has paid overthe people of bp twenty-threeitment to the gulf. billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are open, and many areas are reporting their best tourism seasons in years. and bp's also committed to america. we support nearly 250,000 jobs and invest more here than anywhere else. we're working to fuel america for generations to come. our commitment has never been stronger.

have led to an increase intands clinical depression. drug and alcohol abuse is up. and those dealing with grief don't have access to the professional help they need. when you see these issues, do you want to walk away or step up? with a degree in the field of counseling or psychology from capella university, you'll have the knowledge to make a difference in the lives of others.

let's get started at capella.edu [ tylenol bottle ] me too! and nasal co [ tissue box ] he said nasal congestion. yeah...i heard him. [ female announcer ] tylenol® cold multi-symptom nighttime relieves nasal congestion. nyquil® cold and flu doesn't. there goes the blanchette bridge. if you were anywhere near st. charles, missouri, you might have heard the massive blast that sent a half million pounds of steel plunging into the missouri river. this morning, the demolition is part of an ongoing renovation of the spans that carry interstate

70 over the missouri river. all of the bystanders sure seemed to enjoy watching it go down. >> pretty impressive blast. >> pretty amazing stuff. there is also media fascination with britain's royal pregnancy. here's cnn's jeanne moos. >> reporter: talk about an ultrasound. it's the sound of the world press clicking at the father of the royal fetus. >> big baby news. >> she's got a crumpet in the nothingel pot. a doodle in the noodle. >> what happens if they have twins? >> reporter: first one out gets the throne. no joke. >> they'll be elbowing, i'm out first! >> reporter: this is definitely a first. the first royal to have competing parody twitter accounts while still in the womb. this royal fetus says, "i live inside a princess." while this royal fetus says," it's hardly buckingham palace in year." >> you can tell the baby is a member of the royal family, because kate said she can

already feel it waving. >> reporter: the duchess is probably not laughing at this point, because of a medical condition that's a mouthful. >> it's called hyperemesis graph graph darum. >> reporter: when you're covering this story, there is nothing wrong with a pregnant pause. >> kate has hyperemesis. >> hyperemesis gravidarum, which sounds like a harry potter thing. but -- >> hyperemesis gravidarum, which means you throw up a lot. >> yes. >> it's kind of like morning sickness on steroids. >> this is morning sickness like a tornado is a little wind. >> it's more like morning, noon and night sickness. >> reporter: and you can expect morning, noon and night coverage. >> we'll be here for months. >> i can't be the only person who doesn't give a crap that kate middletop is having a royal baby. >> reporter: don't be so stern, howard. it's a baby. at a hockey game in calgary,

canada, the crowd celebrated by throwing more than 21,000 teddy bears on to the ice. okay, it had nothing to do with the announcement of the royal pregnancy. the stuffed teddies go to needy kids. but, hey, it happened just the day before the baby news went public, foretelling the blessed event. >> is that her holding her abdomen? >> reporter: the duchess could probably use a teddy, the way she has been feeling, while the whole world is watching. >> perhaps the most public gestation since the latest expecting panda. >> reporter: at least the panda didn't have to bear morning, noon and night sickness. jeanne moos, cnn, new york. >> i feel bad. she is obviously not feeling so good right now. we're all obsessed. how is she feeling? a lot -- >> coverage. >> she might have twins. and that's why she's got the severe morning sickness. >> i think if your wife was in the hospital dealing with something like